European markets posted strong gains by Thursday's close, as investors cheered on a positive set of corporate earnings, rather than dwelling on the slump in oil prices.

The pan-European Stoxx 600 index came off session highs, yet closed up 2 percent provisionally, with banks and telecoms leading in the sector space, both finishing above 3 percent.

European markets came under slight pressure during morning trade after data showed that the inflation rate in the euro zone in January was 0.3 percent year-on-year, rather than a preliminary reading of 0.4 percent.

Brent crude fell into over 50 cents to last stand around $33.80, while U.S. WTI crude fell over 2 percent, last trading around $31.40. Oil and gas stocks however shook off the price decline, with Seadrill closing up near 9 percent and Statoil up 3 percent.

French oil firm, Technip led the sector, finishing up over 11.5 percent, after the company posted its fourth-quarter earnings. In the report, the company said while it expects business to dip during this coming year, it believes its 2016 dividend is well covered, according to Reuters.

Basic Resources was the only sector to close in the red, as a decline in metal prices weighed on stocks. Rio Tinto closed over 3.5 percent down.

Earnings to the rescue: Lloyds jumps 13.6%

Earnings season was in full swing, with businesses reporting a positive set of results on Thursday.